Wert Va. Transp. Co v. Standard Oil Co

• Decision Date: 30 November 1901
• Citation: 40 S.E. 591,50 W.Va. 611
• Parties: WERT VIRGINIA TRANSP. CO. v. STANDARD OIL CO.
• Court: West Virginia Supreme Court

40 S.E. 591

50 W.Va. 611

WERT VIRGINIA TRANSP. CO.

v.STANDARD OIL CO.

Supreme Court of Appeals of West Virginia.

Nov. Term, 1901

CORPORATIONS—LIABILITY FOR TORTS—BUSINESS COMPETITION — COMBINATION—VIOLATION OF CONTRACT—BILL OF PARTICULARS.

1. Corporations can be held liable for torts. They can be held liable for damages for torts done in pursuance of conspiracy and combination between them and other corporations or persons, just like natural persons.

2. One may, without liability, in furtherance of his own interest in the competition of business, establish any works competing with another, and may induce customers of that other to withdraw their patronage from him, in order to obtain business for himself, though it injure, and is intended to injure, that other person's business, if there is no contract between such person and his customers. The motive of the person so doing, though malicious, is not material, his acts being lawful. But if he induce such withdrawal of custom not in bona fide neighborly advice, nor in free right of competition to benefit his own business, but wantonly only to injure that other person, he is liable to action. What one may do thus, several, with same justification, may combine to do.

3. Where several combine and agree to do a lawful act, violative of no duty to another due from them, it is not an unlawful conspiracy subjecting them to an action by him, though the act injure him, and was so intended.

4. If one wantonly and maliciously, whether for his own benefit or not, induce a person to violate his contract with a third person to the injury of that third person, it is actionable.

5. The cause of action or ground of defense must be given in the pleadings, not in bills of particulars; but where the pleading is allowably, under the law of pleading, general, so as not to fairly apprise the adverse party of what he has to meet, a bill of particulars may be demanded to amplify the pleading, so as to more minutely specify the claim or defense and to prevent surprise on the trial, but no call for a bill of particulars of evidence can be made.

(Syllabus by the Court.)

Error to circuit court, Wood county.

Action by the West Virginia Transportation Company against the Standard Oil Company and the Eureka Pipe Line Company. From the judgment, plaintiff brings error. Reversed.

W. N. Miller, Van Winkle & Ambler, and Mason B. Ambler, for plaintiff in error.

V. B. Archer, M. F. Elliott, and A. B. Fleming, for defendant in error Standard Oil Co.

BRANNON, J. The West Virginia Transportation Company brought trespass on the case in Wood county against the Standard Oil Company and the Eureka Pipe Line Company, all corporations, and upon demurrer to the declaration judgment was rendered for the defendants. The first count of the declaration charges that the plaintiff was engaged in the business of transporting petroleum oils by means of pipe lines and tank cars from Volcano and vicinity to Parkersburg, and in storing oil, and had expended $300,000 in acquiring land, rights of way, lines of tubing, and other things necessary in its business, and had built up a large and lucrative business, and that the defendants, maliciously and wickedly contriving and intending to injure the plaintiff and ruin its business, and render its plant and property worthless, and deprive it of all its business, did confederate and conspire together and with the West Virginia Oil Company, another corporation, and with C. H. Shattuck and other persons unknown to the plaintiff, to prevent all persons producing, refining, selling, or transporting oils, and particularly to prevent the plaintiff from transporting oils through its pipe lines and by means of its tank cars, and from storing oil in its storage tanks, and from executing any lawful trade in connection therewith. And it charged also that the Standard Oil Company of New Jersey organized about 1801, and was the successor of all' corporations and firms prior to that date associated together under a contract known as the Standard Oil Trust; that the Camden Consolidated Oil Company was a member of the said trust, and under its control; that in 1892 the business and property of said trust were reorganized under, and are now controlled by, the Standard Oil Company, and controlled by the same men formerly owning and controlling said Standard Oil Trust; that the Eureka Pipe Line Company is owned, controlled, and operated by the same men, and doing business in the interest of the Standard Oil Company, and is a transportation branch of that company; that the West Virginia Oil Company was organized about 18S5 to purchase and operate what was known as the property of the West Virginia Oil & Land Company, a territory on which the plaintiff had laid pipe lines, and from which it bad for several years transported oil for compensation; that the Standard Oil Trust, through individuals interested in it, had become a large stockholder in the West Virginia Oil Company, and dictated its management; and by means thereof, and of its monopoly of the production, refining, and transportation of oil throughout the world, practically controlled the business of said West Virginia Oil Company, and since the reorganization of the Standard Oil Trust by the organization of the Standard Oil Company had continued to do so, and had induced the construction of the Eureka Pipe Line Company, and thus ruined the business of the plaintiff; that this was the object and accomplishment of the said combination and malicious conspiracy.

It Is very clear that a corporation can be guilty of a combination or conspiracy with other corporations or persons aimed at and accomplishing the injury of other corporations or persons. It is a mere legal entity, impersonal, and in Itself is incapable of so doing; but it is moved by human beings, is operated by human agents, and is thus an active person,.not only for damage done in the breach of contracts, but for torts doing others harm. It will not avail either to say that it has no power within the scope of its authority to do wrong, and can do only the lawful things contemplated by the state in the bestowal of its charter, and that, therefore, so far as its agents make it do wrong, its acts are outside the field of its legal power, ultra vires, and void, not binding the corporation, and thus that no tort binds it. Such was the old common-law rule, but it is completely overruled. 7 Am. & Eng. Enc. Law (2d Ed.) 824. That doctrine may do as to contracts, but it cannot plead this doctrine to screen itself from its wrongs done to others against their will and rights. Bank v. Graham, 100 U. S. 699, 25 L. Ed. 750. In that case the court says: "They are also liable for acts of their servants while engaged in the business of their principals to the same extent that individuals are liable under like circumstances. Merchants' Nat, Bank v. State Nat. Bank, 10 Wall. 604, 19 L. Ed. 1008. An action may be maintained against its malicious or negligent torts, however foreign they may be to the object of its creation, or beyond its granted powers. It may be sued for assault and battery, for fraud and deceit, for false imprisonment, for malicious prosecution, for nuisance, for libel. In certain cases it may be indicted for misfeasance or nonfeasance touching duties imposed upon it in which the public are interested." Its offenses may be such as will forfeit its existence. Railroad Co. v. Quig-ley, 21 How. 209, 16 L. Ed. 73; 2 Wait Act & Def. 337-339; Ang. & A. Corp. §§ 186, 3S5; Cooley, Torts, 119, 120." Manifestly society must have protection against wrongful acts done by these corporate persons, now so numerous, and performing' so many varied business functions in our day, which so closely touch man in all his affairs. The case of State v. Baltimore & O. R. Co., 15 W. Va. 362, 36 Am. Rep. 803, strongly asserts this liability. So Smith v. Railway Co. (this term) 35 S. E. 834; Gillingliam v. Railroad Co.. 35 W. Va. 588, 14 S. E. 243, 14 L. R. A. 798, 29 Am. St. Rep. 827; Gregory's Adm'r v. Railroad Co., 37 W. Va. 600, 16 S. E. 819. "Upon like grounds an action may be maintained against a corporation to recover damages caused by a conspiracy to which the corporation was a party." 5 Thomp. Corp. § 6315; Buffalo Co. v. Standard Oil Co., 106 N. Y. 669, 12 N. E. 826. If a corporation have no soul, it has a mind, and can commit a tort Involving a mental element It can, therefore, have a bad, malicious motive through its representative agents acting in its transactions. 7 Am. & Eng. Enc. Law (2d Ed.) 830. That a monopoly, a huge corporation, or associate corporations, to establish vast business and derive profits therefrom, to the great detriment— the practical ruin—of the plaintiff and others in like business, is charged in the first count, is true; but that is not enough. It must appear that this monopolistic business hurt the plaintiff. But that even will not do; it must harm it by doing unlawful things. Not only must the plaintiff have a right. but that right must be injured by the defendants, and injured, too, by unlawful means, by acts which the defendants had no right to do. You must establish that the defendants owed a duty to the plaintiff, and broke that duty to make an actionable tort. There can be no tort unless there is a duty from one to another, and that duty broken. You must set this down as a test of tort: "A legal right must be invaded in order that an action of tort may be maintained. The mere fact that a complainant may have suffered damage of the kind which the law recognizes is not enough. There must also be a violation of a duty recognized by law. In the language of the civil law mere damnum is not enough; there must also be injuria; that is, "Ex damno absque injuria non oritur actio.' " 1 Jag. Torts, 87. We must nicely distinguish between damnum and injuria. We commonly use the words "injury" and "damage" indiscriminately, but in the rule above these Latin words are distinct. "D...